Frequently asked questions about health insurance
coverage options in Texas
Texas utilizes the federally run marketplace (exchange) at HealthCare.gov and has one of the highest exchange enrollments in the country. Only Florida and California have higher exchange enrollment.
The insurance marketplace offers health insurance plans for individuals and families who need to buy their own health insurance. This includes early retirees (who will transition to Medicare when they turn 65), self-employed residents, and people employed by a small business that doesn’t offer employer-sponsored health benefits.
Using the marketplace is optional; individuals and families in Texas can choose instead to buy coverage directly from a health insurance company. But the marketplace is the only place where Texas residents can qualify for financial assistance benefits based on their household income. This includes premium subsidies (which offset the monthly cost of coverage) and cost-sharing reductions (which reduce out-of-pocket medical costs — deductibles, coinsurance, and copays).
Read our overview of the Texas health insurance marketplace – including news updates and exchange history.
In Texas, open enrollment for 2022 health coverage ran from November 1, 2021 through January 15, 2022. Outside of open enrollment, you’ll need a qualifying event in order to enroll in coverage or make a change to your plan for 2022.
During the open enrollment period for 2021 coverage, 1,291,972 Texas residents signed up for private individual market plans in the Texas health insurance marketplace.
In addition, nearly 300,000 people had enrolled in coverage during the first few months of the COVID-related special enrollment period in 2021. This was more than triple the normal enrollment volume during that time period (when a qualifying event would normally be necessary in order to enroll).
Read more about yearly enrollment totals in the Texas health insurance marketplace.
For 2022, four insurers are joining the Texas marketplace, with plans that will be available for purchase starting November 1, 2021. Plan availability will vary from one area to another, but a total of 14 insurers will be offering 2022 coverage in the Texas marketplace:
- Aetna CVS Health
- Celtic/Ambetter (Ambetter from Superior Health Plan)
- Blue Cross Blue Shield of Texas
- Bright Healthcare
- Friday Health Plan
- Moda Health Plan
- Community Health Choice
- Scott & White Health Plan
- UnitedHealthcare of Texas
The ACA would have expanded Medicaid to cover all legal residents in Texas with incomes up to 138% of the federal poverty level, but a Supreme Court ruling in 2012 allowed states to opt out of Medicaid expansion. Texas remains among the dwindling minority of states that have continued to reject the expansion of Medicaid.
Because of the state’s refusal to expand Medicaid, 771,000 Texans are in the coverage gap, with no access to financial assistance with their health insurance. This is far more than any other state that has not expanded Medicaid – the next highest is Florida, with about 415,000 people.
Between 2013 and March 2017, Texas’ existing Medicaid/CHIP program saw an increase of about 13 percent, despite the very strict eligibility guidelines that the state uses. By 2019, enrollment had actually dropped to below where it had been in 2013. But by May 2020, total enrollment in Texas Medicaid/CHIP was up to 4 percent higher than it had been in 2013. The COVID pandemic has been driving Medicaid enrollment higher across the country, due to the widespread job losses and income reductions. This is true even in states like Texas that have not expanded Medicaid under the ACA.
Read more about Medicaid in Texas.
Medicaid eligibility rules in Texas are particularly strict: Non-disabled adults without dependent children are ineligible regardless of income, and parents with dependent children are only eligible if their household income doesn’t exceed 15% of poverty (about $275/month for a family of three).
Texas regulations regarding the definition and duration of short-term health plans align with new federal short-term rules. As a result, short-term health insurance plans in Texas can have initial terms of up to 364 days and can be renewed for a total duration of 36 months.
Read more about short-term health insurance in Texas.
There were more than 4.3 million Texas residents enrolled in Medicare as of mid-2020. That’s about 14% of the state’s population, versus 19% of the U.S. population enrolled in Medicare. Most of the state’s Medicare beneficiaries are eligible for the coverage due to their age (at least 65), but 14% are under the age of 65 and eligible for Medicare because of a disability.
More than 2.3 million Texas residents are enrolled in Original Medicare (Part A, hospital coverage, and Part B, outpatient coverage), while more than 2 million are enrolled in private Medicare Advantage plans. The number of Medicare Advantage members has been growing faster than overall growth in Medicare enrollment.
You can read more about Medicare in Texas, including details about the state’s rule for Medigap plans, as well as the availability of optional Medicare Advantage and Medicare Part D prescription drug plans.
In 2010, Texas’s U.S. Senators John Cornyn and Kay Hutchison, Republicans, both voted no on the ACA. In the U.S. House, 20 Republican representatives from Texas voted no, while 12 Democrats voted yes. Ted Cruz has since replaced Hutchison in the Senate, and is one of the country’s most outspoken opponents of the ACA.
Former Texas Gov. Rick Perry was also staunchly opposed to the ACA and had a state legislature with a strong Republican majority. The state opted to let HHS run the exchange, has refused to expand Medicaid, and even worked to make it more difficult for navigators to do their job in Texas.
In January 2015, Greg Abbott took office as Texas’ governor. He has voiced his opposition to expanding the current Medicaid system. However, he would like to see Texas use federal Medicaid funds in the form of block grants.
Before the ACA was implemented, according to U.S. Census data, Texas had the highest uninsured rate in the country in 2013 (22.1%). It’s gone down since then, but Texas still had the highest uninsured rate in 2019, at 18.4%.
Texas leaders have been vocally opposed to the ACA, and the state has thus far refused to expand Medicaid, so a cornerstone of the law’s ability to reduce the uninsured rate is unavailable in Texas.
But more than 1.2 million Texans are enrolled in private health plans through the exchange. In early 2021, before the American Rescue Plan‘s subsidy enhancements, 92% of Texas exchange enrollees were receiving premium subsidies that averaged $478/month. And 60% were receiving cost-sharing reductions, which make their out-of-pocket healthcare expenses (deductible, copays, coinsurance) less costly.
With the American Rescue Plan in place, average after-subsidy premiums in the Texas marketplace have dropped from $84/month to just $52/month.
Texas only has legislative sessions in odd-numbered years. This resource, published by the Texas Department of Insurance, details bills related to health reform that were enacted in Texas in the 2017 legislative session.
- SB1296, enacted in 2021, creates an effective rate review program in the state. This means Texas will no longer defer to the federal government to review rate proposals that insurers submit for the coming year. The new Texas review program will be used starting with the 2023 rates that are filed in 2022.
- SB1742, enacted in 2019, requires health plan provider directories to make it clear whether specialists practicing at in-network facilities are also in-network. In addition, the legislation imposes new rules related to prior authorization, including a readily available list of services that are subject to prior authorization requirements, and information about the insurer’s total volume of prior authorization requirements and denials.
- SB1264 protects Texans enrolled in state-regulated health plans (ie, plans that aren’t self-insured) from surprise balance billing. It applies to medical services received on or after January 1, 2020, and essentially requires the insurer and the out-of-network provider to work out the payment arrangements without involving the patient. Surprise balance billing refers to situations in which emergency care is provided at an out-of-network facility, or when a patient goes to an in-network facility but is treated — often unknowingly — by a medical provider who isn’t part of the patient’s insurance network. Instead of billing the patient for amounts above their normal cost-sharing requirements, the out-of-network provider has to use a state-regulated mediation/arbitration process to work out a payment amount with the patient’s insurer.
- SB1037, enacted in 2019, ensures that surprise balance bills that are sent to collections won’t show up on the person’s credit report.
- HB214, enacted in 2017, prohibits coverage for elective abortion on all major medical plans (including plans sold through the exchange) in Texas. Twenty-five states had already enacted similar legislation.
- SB1406, enacted in 2017, authorized the state to submit a 1332 waiver proposal to the federal government, seeking permission to waive the actuarial value requirements that currently apply in the small group health insurance market. The idea is to allow small group plans to have a wider range of actuarial values, instead of having to conform to the current bronze, silver, gold, or platinum categories. The legislation was signed into law in May 2017, but the state never submitted a 1332 waiver proposal. The Texas Department of Insurance published a brief in early 2018 detailing several other potential 1332 waiver proposals that could be used to stabilize the individual market, but related legislation was not enacted in 2019.
- Texas Department of Insurance – Oversees, regulates, and licenses the health insurance companies that provide coverage in the state, as well as the agents and brokers who sell the policies.
- Texas Health Information, Counseling and Advocacy Program – A resource for Medicare beneficiaries and their caregivers; can answer questions about a wide range of Medicare issues.
- Change Happens Healthcare Navigators – This is the federally-funded Navigator organization in Texas (the business office is located in Houston, but the Navigators can provide assistance, answer questions, and help with enrollments statewide).
- Medicare Rights Center – A nationwide resource for Medicare beneficiaries.